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The British Property Federation (BPF) is calling for a more long-term plan from the government in terms of the recently published Industrial Decarbonisation Strategy, which offers guidance up to the year 2030.

This article will take a look at the details of the government’s strategy for decarbonisation in the property industry, as well as sharing feedback from the property industry and the BPF.

The UK Government’s Industrial Decarbonisation Strategy

In March 2021, the British government published its policy paper on industrial decarbonisation, which lays out how industry should decarbonise in line with net-zero. The strategy focuses on reducing carbon emissions throughout industry, whilst remaining a competitive economy and avoiding moving carbon emissions to other countries.

The UK is the first major economy to produce an industrial decarbonisation strategy. The policy paper sets out the government’s vision for a successful low-carbon industrial sector by the year 2050, so that industry decision-makers feel confident in moving towards a decarbonised industry.

The BPF and the Industrial Decarbonisation Strategy

Property investors such as Zuneth Sattar will be affected by the Industrial Decarbonisation Strategy, which revisits the Minimum Energy Efficiency Standards for commercial property – which, according to the new strategy, should achieve an EPC B rating by 2030.

The government strategy also sets new standards in terms of performance-based energy ratings for industrial and commercial buildings, which should play an important part in supporting property owners to achieve net-zero. These performance-based energy ratings will first apply to all commercial offices in England and Wales that measure more than 1,000 sqm, which is estimated to be around 10,000 buildings.

Criticism of the Industrial Decarbonisation Strategy

Many figures from the world of property investing have criticised the strategy for being too short-sighted, as the trajectory for the regulation is still relatively unknown beyond 2030. This is an issue for the property industry in particular, as property owners and investors will make decisions in the present day for buildings and developments that will stretch well beyond the year 2030, yet they do not yet know the regulations that will apply in terms of decarbonisation and net-zero.

In response to industry criticism of the policy, the British Property Federation has urged the UK Government to provide the net-zero regulations that will apply beyond 2030, as this should facilitate new investments and enable property owners to maximise their contribution to the country’s net-zero goals. For further information about net-zero, please refer to the embedded PDF.

Alex Green of the BPF noted that the current system in the UK of Energy Performance Certificates has resulted in some improvements in energy consumption. However, it would be more effective to require owners and single tenants of commercial buildings to obtain operational energy ratings. Green’s suggestion of using operational energy ratings, in addition to Energy Performance Certificates, would result in the commercial properties being more efficient, with owners and occupiers of a building working together to achieve net-zero.

The BPF is also calling for the government to apply its new rating system to other types of commercial buildings, including retail, while also considering the unique challenges that these buildings present. The federation believes that for the commercial property industry to achieve positive results for the environment, it is of the utmost importance that accurate measurements of energy are collected.